The U.S. arm of Atari has filed for Chapter 11 bankruptcy in New York as part of an effort to separate itself from its financially troubled French parent company, reports latimes.com (thanks Develop). Here's an excerpt that sums up the situation:

But the company's growth potential has been hampered by its near total reliance on London financial company BlueBay Asset Management for cash. A $28-million credit facility with BlueBay lapsed Dec. 31, leaving Atari without the resources to release games currently in the works, including a real-money gambling title titled "Atari Casino."

Efforts to recapitalize the corporation have been unsuccessful, in part because of its complex structure as essentially an American business with a French public stock listing.

Shares in Atari S.A. have dropped in value from more than 11 Euros in 2008 to less than 1 Euro recently.

Atari Inc. has secured a commitment for $5.25 million dollars in debtor-in-possession financing to continue operations and release games. If Chapter 11 is successfully completed, the U.S. business could reemerge with its own resources and little or no debt to BlueBay.

It's not yet clear who might step up to buy Atari Inc., although Wilson will probably seek backers to help him keep control. It's also possible the company could be sold to another buyer, whole or in pieces.

I think it is definitely for the best that Atari folds now before they tarnish even more the few fond memories we have of them with gambling for real cash and creating more misery in gambling addicts's lives.

Some zombie company - another zombie company - took its name and tried to make money. Who cares if that is bankrupt now?ZZZ...zzz...ZZZ...zzzzzzz...Noting this is not remotely the company I grew up with,Ray

NegaDeath wrote on Jan 21, 2013, 12:18:I don't know what's sadder, that noone has been able to make the brand work since the crash in the 80's or that the Atari name is almost worthless now.

Sadder still is their Arcade division Atari Games, formerly owned by WMS (Willams Bally Midway) actually still went on to make some pretty awesome coin op games in the early 90's. The home division moniker however which is what Infograms has been using for the past decade hasn't done shit to improve the brand, instead hurting it over the years.

Ozmodan wrote on Jan 21, 2013, 08:59:Atari, one of the most mismanaged companies in the genre. Fire the top executives and you might end up with a respectable company. Current execs are completely worthless!

What's respectable?

Does anyone even know who Atari is? I mean, we know who it was, but the name has been passed around infinitely. Who is it now? Infogrames owns it, and they're certainly not respectable. And I think Atari owns Cryptic, who you can argue is respectable, but that's part of Atari, not Atari itself.

What is Atari that you think it may be respectable?

Yeah I was gonna say. Atari has been Infograms for a long time now, Kinda weird seeing them try to diverse themselves of themselves.

Parallax Abstraction wrote on Jan 21, 2013, 09:08:Even when the industry was doing really well back in 2003-2008, Atari still managed to lose buckets of money.

On paper. Always remember that these losses are on paper, and are typically the result of blatant felony-level outright liescreative accounting.

EA has been losing money since like 1927, but the company is still perfectly fine, and the IRS apparently doesn't find this peculiar.

(of course, the US government does the exact same thing: Lose money hand over fist and keep on trucking. :p )

I gotta agree with Beamer, there's nothing about Atari that is respectable since they got bought by Infogrames. It's a miserable piece of shit company that ruins licenses, releases poorly tested games then refuses to patch them, and in general is a fucking blight on the game industry.

The sooner it dies, the better. Maybe someone decent can buy the licenses/IP they hold and do something interesting with them.

nin wrote on Jan 21, 2013, 08:35:Wonder what this does for the BG:EE just released on steam? It was behind on patches, and Overhaul said it was due to Atari doing it themselves...(and that patches would eventually come from them).

Atari has been screwing over games and the DnD franchise for years. Which is why they lost the license, especially after the pitiful release of Daggerfall, that had so much potential but was released at least 6 moths to early and they never kept their promises to release a patch to fix the game.

I feel no symphony for this shitty company. They have turned in to this decades Interplay. They need to go bye, bye!

Ozmodan wrote on Jan 21, 2013, 08:59:Atari, one of the most mismanaged companies in the genre. Fire the top executives and you might end up with a respectable company. Current execs are completely worthless!

What's respectable?

Does anyone even know who Atari is? I mean, we know who it was, but the name has been passed around infinitely. Who is it now? Infogrames owns it, and they're certainly not respectable. And I think Atari owns Cryptic, who you can argue is respectable, but that's part of Atari, not Atari itself.

Even when the industry was doing really well back in 2003-2008, Atari still managed to lose buckets of money. They've been run by clueless twit after clueless twit for more than a decade, they just managed to somehow survive longer than similarly badly run companies like Midway. The only thing that's kind of a shame is a lot of classic IP might end up being split up and sold to companies that might not do anything with it. Beyond that, the industry's better with this company gone.